Social Publishing Site Scribd Adds E-Commerce; 80% Revenue To Publishers

Document-sharing site Scribd will begin beta tests of an e-commerce platform today in an effort to tap into publishers increasing interest in charging consumers directly for digital content.

The company also hopes its e-book marketplace will tamp down criticism that it abets online piracy of printed books; complaints about Scribd and competitor Wattpad were highlighted just last week in the NYT.

Scribd, which has offered free uploading and sharing of documents since launching two years ago, believes that the rise of
Amazon.com
s Kindle has made the notion of buying texts online much more acceptable.

After this weeks launch, Scribd will focus on a corresponding
Apple
iPhone app, similar to the idea behind the Kindle iPhone app. But thats where the similarities end.

Publishers will set prices: Unlike Amazons revenue-share model, which typically takes as much as a 70% split of the revenue from some content providers, the new Scribd Store will let content owners keep 80% of the revenue from purchases of their works, said Tammy Nam, Scribds vice-president of content and marketing, in an interview with paidContent.

Authors and publishers in the Scribd Store will also be able to set their own prices and DRM options. Prices currently range from $1 for a graphic novel panel to $5,000 for an in-depth market-research report on China.

For the most part, theres a lot of work thats going to be uploaded, so we wanted to lower the barriers, Nam said of the reasoning behind the pricing and DRM structure. Our main objective is to get new content to the site. We think its going to be a lot like
eBay
in a lot of ways, where youll have a mix of amateur and professional content sellers. But in particular, as a site with 60 million monthly readers, we believe there is a huge long tail of non-professional content.

Combating piracy: The introduction of the Scribd Store and its self-serve DRM settings wont necessarily cut down on plagiarism and copyright violations. But by giving authors and book publishers a chance to make some money from its site, Scribd hopes to mollify its critics.

Separately, Scribd said it maintains a copyright database of protected works and tries to police against unauthorized use. Every work uploaded to the Scribd Store will be automatically added to that database, which also covers the free site.

Several publishers are already lined up for the Scribd Store. For example, the Lonely Planet community site and travel guide will sell single chapters starting at $2.50 and $12.50.

My name is David Kaplan and I've been involved in the Securitized Product markets since 1984 and have witnessed their growth from a cottage industry to a multi-trillion dollar segment of the global capital markets. My experience has included senior roles in trading, institu...